The price of garlic went from "fierce" to "miserable" between the start of 2017 and the middle of 2018. In some production areas the price dropped as low as 0.3 yuan [0.04 USD] per 0.5 kg. This is the lowest the garlic price has been in 10 years. A new garlic planting season has begun, but with the market in depression, is there room for more garlic this year?
The new garlic planting season has begun
Garlic price development turns around once every three years
The price development of garlic turns around once every three years, but it is also important to look at the amount of fluctuation. The price of garlic even increased recently and this development continued for one month. The price would be relatively stable if it was not for the extreme weather conditions and people speculating on the market.
Excessive stock of preserved garlic
The overall surface area devoted to garlic production in China increased every year between 2014 and 2017. The surface area reached a peak in 2017, which resulted in a situation during the summer garlic production season in 2018 where supply greatly exceeded demand. Many garlic farmers in Shandong and Henan suffered great losses. This certainly has had an influence on the enthusiasm of garlic farmers this year.
Garlic
The major garlic production areas have entered the autumn planting season and garlic farms in Shandong, Henan, and Hebei show various degrees of decreases in the surface area devoted to garlic plantation. It is difficult to predict how much the surface area decreased as the planting season is not yet over. Some farmers will decide to supplement garlic plantation with other crops, and the overall surface area devoted to garlic plantation in China is estimated to show a limited decrease this autumn.
However, the overall surface area devoted to garlic plantation needs to decrease by 40% to reach the level of 2014. Furthermore, there is still a volume of 170-180 thousand tons of preserved garlic on the market. China still suffers from excessive garlic supply, and the extent to which this situation is going to change next year depends on how much the surface area devoted to garlic plantation will decrease.
Source: 998 Voice of Ruzhou Baijiahao